Dr MJ Khan
On July 24, 2025, India and the United Kingdom signed the landmark Comprehensive Economic and Trade Agreement (CETA) during Prime Minister Narendra Modi’s official visit to London. This historic deal, one of India’s most significant bilateral trade agreements with a developed nation, marks a new chapter in Indo-UK economic relations, with profound implications for Indian agriculture, trade, and the rural economy. While the agreement encompasses tariff reductions across goods, services, and investments, its strong focus on agricultural and processed food exports stands out. As India seeks to position its farmers as global suppliers and agri-entrepreneurs, CETA provides a strategic opportunity to elevate Indian agriculture to new heights.
**Immediate Gains for Indian Farmers**
Under CETA, approximately 95% of Indian agricultural and processed food products gain zero-duty access to the UK market—one of the world’s most affluent and quality-conscious. Key beneficiaries include tea, coffee, spices, fruits, vegetables, marine products, basmati rice, and processed foods such as ready-to-eat meals, juices, and snacks. This will lead to better price realization for Indian farmers, particularly those producing premium, export-oriented commodities. For smallholder farmers and rural cooperatives engaged in value-added products, this opens direct access to a $3.5 trillion consumer market, fostering higher incomes, reduced dependency on traditional mandis, and greater market diversification.
Strengthening Agricultural Value Chains
The anticipated surge in demand for Indian agri-products will drive improvements in quality, certification, packaging, and traceability. This will spur investments in post-harvest infrastructure, including cold chains, food processing units, and export logistics. Enhanced compliance standards will elevate overall production quality, preparing India for other global markets. Additionally, the focus on processed foods and agri-innovation will encourage rural entrepreneurship. Startups in food tech, precision farming, and logistics will find new incentives to scale, supported by rising international demand and policy momentum.
Boosting Rural Employment and Innovation
CETA’s long-term impact includes its potential to generate rural jobs and rekindle youth interest in agriculture. As global demand for Indian agricultural products grows, so will the need for skilled workers in food processing, logistics, digital agriculture, and export compliance. Young agripreneurs will find opportunities to build export-oriented agribusinesses—from spice clusters in Kerala to seafood hubs in Gujarat and rice belts in Punjab. CETA not only provides market access but also inspires rural innovation, fostering a dynamic exchange of knowledge, technology, and expertise to modernize Indian agriculture from the grassroots.
Strategic Trade and Economic Positioning
The India–UK CETA holds significant strategic importance. While sensitive sectors like dairy, poultry, and sugar are protected to safeguard socio-economic vulnerabilities, the inclusion of value-added agri-exports demonstrates India’s readiness to leverage its agricultural diversity globally. The agreement is projected to double bilateral trade to $100 billion by 2030, with agriculture as a key driver. It also positions India favorably for upcoming trade negotiations with the EU, Canada, and the US, proving that India can secure deals without compromising farmers’ interests.
Challenges Ahead: Compliance, Capacity, and Competition
Despite its potential, CETA’s benefits require proactive efforts. Indian farmers and exporters will need support to scale production, meet stringent UK quality standards, and navigate complex export regulations. India also faces competition from established agri-exporters like Vietnam, Thailand, and Latin American countries with robust supply chains in Europe. To succeed, India must invest in training, certification systems, agri-clusters, and digital traceability. The Indian Chamber of Food and Agriculture (ICFA), the apex body representing farmers and the agro-industry, is preparing to assist exporters and stakeholders in maximizing the benefits of this pact.
Conclusion: A Historic Milestone, A Transformative Opportunity**
The India–UK CETA is more than a trade agreement—it is a catalyst for transforming Indian agriculture. With strategic investments, effective implementation, and a focus on inclusive growth, CETA could lay the foundation for an agricultural revolution driven by exports, innovation, and farmer prosperity. The ICFA is forming a Working Group on CETA to develop an actionable roadmap for Indian agro-traders, exporters, and state governments to fully capitalize on this opportunity.
(Note:Dr. MJ Khan Chairman Emeritus, Indian Chamber of Food and Agriculture
President, International Agriculture Consulting Group)
